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Sridhar Vembu, the founder of Zoho, has expressed his worries about the US stock market calling it a “clear and huge bubble.”

Vembu's alert comes after the economist Gita Gopinath's statement that investor's money is now more dependent on US stocks than it ever was before, hence making the system very prone to a market correction which could be deeper than the dot-com crash.

Gopinath pointed out that the core issue is “unbalanced growth” rather than “unbalanced trade.”

Vembu highlighted the risks posed by high leverage in the financial system, drawing comparisons to the global financial crisis of 2008-09. “The degree of leverage in the system means that we cannot rule out a systemic event like the global financial crisis of 2008-9,” he said on X.

The entrepreneur also commented on gold, noting that the precious metal is signaling caution. “I don’t think of gold as an investment, I think of it as insurance against systemic financial risk,” Vembu said, adding, “Ultimately, finance is all about trust, and when debt levels reach this high, trust breaks down.” He concluded his post with a touch of sarcasm: “I am sure AI will work hard to repay all the debt in the system.”

The post drew strong reactions online. One user said, “The concentration of global capital in US equities has created unprecedented vulnerability. When leverage is this high and valuations are stretched this far, any correction cascades faster and harder than before.”

Another noted, “The gold rally is basically the market pricing in systemic risk that official measures refuse to acknowledge. The real issue is unbalanced growth creating fragile dependencies rather than resilient distributed prosperity.”

Others echoed the warning: “Absolutely. The US debt explosion and the equity bubble since the Fed’s interventions have only deepened systemic risks. It’s a ticking time bomb.”

Several users also emphasised the need for realism in investing, with one noting, “If we want fewer bubbles, we need to stop mixing up two things: building real value today vs selling a story about tomorrow.” Another warned, “This exponential bubble will burst soon, and remember it will be BRUTAL.”